On
November 18, 1994, Regency Affiliates acquired a 50% economic
partnership interest in Security Land and Development Company
Limited Partnership. The Partnership owns a two-story office
building and a connected six-story office tower occupied by the
United States Social Security Administration Office of Disability
and International Operations under a fifteen year lease expiring
2018. The office building has net rentable area of 717,000 square
feet and is located on a 34.3 acre property in Woodlawn, MD. The
significant terms of the lease include gross annual rent of
approximately $12,754,000 with Security Land being responsible for
the operating expenses of the building and for upgrading some of the
building’s common areas.

On
April 30, 2004, Regency through a newly formed, wholly-owned
subsidiary called Regency Power Corporation, a Delaware corporation
acquired a 50% membership interest in MESC Capital LLC, a Delaware
limited liability company from DTE Mobile, LLC. MESC Capital was
formed to acquire all of the membership interests in Mobile Energy
Services Company, LLC. Mobile Energy owns an on-site energy
facility that supplies steam and electricity to a Kimberly-Clark
tissue mill in Mobile, Alabama. The facility’s operations are
overseen by DTE Mobile, a unit of DTE Energy Company. The energy
facility is located on approximately 11 acres within
Kimberly-Clark’s facility and supplies up to 61 megawatts of
regenerated steam and electricity for use in the mill’s operations.